China will overtake Japan to become the world's second biggest spender on research and development (R&D) in 2006, according to the latest forecast.
China is closing in on the amount spent on R&D in the United States
China is predicted to spend around $136bn (£68.7bn), on R&D in 2006, the Organisation for Economic Cooperation and Development (OECD) said.
This is ahead of Japan's forecast spend of $130bn.
The United States will remain the world's leading R&D spender, predicted to invest $330bn.
The EU-15, which includes the UK, France and Germany, will spend just $230bn, the organisation predicts.
R&D Intensity, 2004
"The rapid rise of China in both money spent and researchers employed is stunning," said Dirk Pilat, the OECD's science and technology policy chief.
China's R&D intensity, which is the amount spent on R&D as a percentage of its economy, increased from 0.6% to 1.2%, in the decade to 2004, the OECD said.
The number of Chinese researchers increased by 77% over the same period, and the country now ranks second with 926,000 people engaged in research, behind 1.3 million in the US.
China's increased investment in research partly reflects its economic expansion, but OECD research suggests a greater emphasis on science is also fuelling growth.